What are Dispute Resolution Orders – If Domestic Building Disputes are not settled at Conciliation at the Domestic Building Dispute Resolution Victoria, Dispute Resolution Orders can be Issued
Pursuant to the Building Legislation Amendment (Consumer Protection) Act 2016 (Vic) (“the Act”), changes to procedures for resolving domestic building disputes will commence on 1 July 2017 after amendments to the Domestic Building Contracts Act 1995 (Vic).
The Domestic Building Dispute Resolution Victoria (DBDRV) will be introduced to handle the conciliation of suitable domestic building disputes as a preliminary requirement before proceedings can be initiated in Victorian Civil and Administrative Tribunal (VCAT).
The DBDRV is headed by the chief dispute resolution office with the assistance of conciliators and assessors within the body.
Domestic building disputes can be referred to the DBDRV by the building owner, a builder, registered building practitioner, sub-contractor, or an architect.
Parties to a domestic building dispute will have to satisfy the following before a dispute can be initiated:
- seeking an injunction; or
- either participated in conciliation or have a certificate of conciliation; or
- has the court leave.
Purpose of a DRO
The DBDRV can issue a DRO to either a builder or a building owner.
If issued to a builder, the DRO can require that a builder rectify damage caused by repair work; undertake rectification works; or to complete works under the domestic building contract. If a DRO is issued to the builder, then the DBDRV must issue a copy on the insurer of the builder.
A DRO can also make it a requirement for another appropriately qualified building practitioner to carry out the work or to pay an amount of money to cover the reasonable cost of the works performed to rectify or complete the works.
If issued to an owner, the DRO can require that an owner make a payment to the builder; refrain from doing anything that would hinder the builders ability of satisfying a term or condition under the domestic building contract; or from meeting the requirements of the section 8 DBCA warranties.
The determination of the DBDRV will be included in the DRO to describe if the domestic building works under the domestic building contract are either defective, incomplete or a combination of incomplete and defective works. The Tribunal is permitted to consider such a determination if proceedings are initiated by an effected party.
Administration of DRO’s
A DRO once issued will be monitored for compliance by the DBDRV by appointed assessors who will have the power to compile reports and carry out inspections.
The assessors will include building practitioner and architects. The assessor will have the ability to investigate any aspect of a dispute with the authority to access a building site; carry out investigate testing; require a person present at the building site to provide reasonable assistance and evidence; and to obtain independent advice from relevant experts.
For the purposes of the Domestic Building Contracts Act 1995, “building site” is defined to be the property where domestic building works have either commenced or are due to commence.
If a DRO is not complied with then the DBDRV has the authority to issue breach notices to the non-compliant party. If a builder fails to comply with the DRO then a disciplinary VBA inquiry hearing can be heard in relation to the matter and the VBA has the ability to issue disciplinary sanctions and/or fines.
A party who receives a breach notice will have the ability to have the decision to issue the notice review in VCAT. This will be an important change that legal practitioners and relevant parties to a domestic building dispute will have to be aware of come 1 July 2017.